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                Violations And Penalties


                Article (107)
                The following shall be regarded as a violation of the provisions of this Law:
                A- Submitting false or misleading data in any document filed with the Commission;
                B- Offering or selling securities on the basis of false or misleading data regarding:
                1. the rights and privileges conferred by the security being offered or sold;
                2. the nature of the Issuer's business, the success thereof,  the Issuer's financial conditions or future prospects .
                C- Certifying by an auditor or accountant of false or misleading financial statements or statements which are in violation of adopted accounting and auditing standards. In such a case, the accountant or auditor, as the case may be, shall be liable for damages to any party suffering financial loss as a result of such false or misleading financial statements.
                D- Any Deception or Misrepresentation relating to securities or any Prohibited Act relating to the licensed activities in accordance with the provisions of this Law.

                Article (108)
                A person shall be in violation of the provisions of this Law, upon committing any of the following acts:
                A- Trading in securities or influencing others to trade in such securities on the basis of inside information;
                B- Using inside or confidential information to attain material or moral gains whether for his own benefit or for the benefit of others, including members of the board of directors and employees of the Market and the Center;
                C- Disclosing inside information to other than the competent authorities or the Courts.

                Article (109)
                It shall be prohibited for any person:
                A- To disseminate and promote rumors or to provide false or misleading information, data or statements which may affect the price of any security or the reputation of any Issuer;
                B- Solely or in collusion with others, to effect any transaction in securities with the intention of creating a false impression of the price or volume of trades of a security or any related security.

                Article (110)
                A- Any person who violates the provisions of this Law or the regulations, instructions or decisions issued pursuant thereto shall be subject to a fine of not more than one hundred thousand (100,000) Dinars, in addition to a fine of not less than twice the amount, and not more than five times the amount, of profit made or loss avoided by the person committing the violation.
                B- Without prejudice to any stricter penalties imposed by any other legislation, and in addition to the fines specified in Paragraph (A) of this Article, any person violating the provisions of the Articles mentioned hereunder shall be subject to the following penalties:
                1. Imprisonment of up to three years for violations of the provisions of Paragraph (C) of Article (63), Paragraphs (A) and (B) of Article (108), and Article (109) of this Law;
                2. Imprisonment of up to one year for violations of the provisions of Subparagraph (1) of Paragraph (A ) of Article (34), Paragraph (D) of Article (42), and Paragraphs (A) and (B) of Article (47) of this Law.
                C- The Competent Court may exempt from the imprisonment penalty first offenders and offenders who deposit in Court or with the Commission sufficient funds to pay the amount of the fines which may be ordered by the Court, provided the funds are paid before the Court decision becomes final.
                D- Accomplices, aiders and abettors shall be subject to the same penalties.
                E- If the offender is a legal person, then members of its board of directors or board of executives, general partners and concerned employees shall be deemed liable for the violation, unless it is established that they had no knowledge of the violation.
                F- A person who is convicted of a violation, whether the violation is intentional or as a result of negligence, or of failing to exercise due care, shall be held liable for the damages incurred by other persons in the amount of loss incurred or profits foregone.
                G- The Competent Court may sequester the assets of a person who stands trial before the Court to ensure that sufficient funds are available for possible future fines or restitution the Court may order, and may appoint a judicial custodian over such assets.

                Article (111)
                A- Any investor who incurs financial loss as a result of the sale of securities may claim remedies for damages from the seller or the Issuer, as the case may be, provided he establishes that :
                1. the sale was carried out in a manner that violates the provisions of this Law and the regulations, instructions and decisions issued pursuant thereto; and
                2. that he has incurred a financial loss as a result of the sale of such securities.
                A- Any investor who incurs a financial loss because of incorrect, inaccurate or inadequate disclosure in a prospectus, or its attachments, or in any reports filed with the Commission in accordance with the provisions of this Law may claim restitution from any person who signed such documents, provided he establishes that:
                1. the prospectus, its attachments, or the reports omitted facts material and necessary to an investor in the decision to sell, buy, or continue to hold the securities;
                2. the prospectus, its attachments, or the reports set forth a false or misleading data material to an investor in the decision to sell, buy or continue to hold securities.
                B- A person incurring damages shall institute the action for restitution before the Competent Court no later than two years
                following:
                1. the date of the sale, where the damages have resulted from sale of a security;
                2. the effective date of the prospectus or the date of filing the report or the date at which it should have been filed, as the case may be.

                Article (112)
                The Board may restrict, suspend or revoke the license or registration granted in accordance with the provisions of this Law in any of the following cases:
                A- If the Licensed or Registered Person violates any of the provisions of this Law or the regulations, instructions or decisions issued pursuant thereto;
                B- If the Commission finds that such a person has committed fraud or deceit;
                C- If the Licensed or Registered Person is convicted by the Competent Court of fraud or deceit in connection with any transaction in securities.

                Article (113)
                A- Civil and criminal securities cases shall be handled by the Competent Courts expeditiously, including the enforcement of court decisions.
                B- Notification procedures in court cases involving securities shall be carried out pursuant to the Civil Proceedings Law. However, notification of persons whose place of residence or business is outside the Kingdom, shall be either at the address of choice thereof within the Kingdom, if any, or by advertising the notification in at least one local daily newspaper, and sending a copy of the notice voucher or announcement by registered, courier or first class mail to the address outside the Kingdom, filed at the Commission. In the latter case, the notification date shall be the seventh day from the date of depositing the notification voucher with the mail.
                C- Notwithstanding the provisions of any other legislation, all means of proof shall be admitted as evidence in securities cases, including electronic or computer data, telephone recordings, and telex and facsimile messages.





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